All Forum Posts by: Mike K.

@J Scott - got it. Thanks for your input.

@J Scott - Thanks - Does that number (%) remain the same when doing a rehab for a buy and hold rental?

@Marc Winter - thanks for the response.  I've been working with relatives for years, worked with my old man for 22 yrs and pretty much the same with another cousin here in NY with our woodworking/construction business so I completely understand what you mean and where you are coming from but we've never experienced any issues in all those years even if we've had disagreements.  We've all be pretty good with keeping business decisions about business and family about family.  In my opinion losing a relationship with a family member or even a friend over a few bucks isn't worth it.  

I guess I would think about it differently if I've had bad experiences in the past or if I thought that we would be way off on our numbers when having to wrap up the project and make payment.  

With that said, I get the hesitation and its duly noted with good reason.  Thanks again for the input.  Appreciate your time.  

Stay well. 

@J Scott - thanks for the reply.  I know that not much is standard in any industry, I was basically looking to see what others have done since I had something in my mind as well.  My cousin and I spoke about it today and are having an open dialogue about it.  We both admit that things should have been discussed earlier but since this was completely new waters for the both of us neither of us really knew how much involvement was going to be required.  We want it to be fair for the both of us and we both understand that.  Moving forward (and I mean on other projects) we would have a better understanding of what is involved so we can come to some sort of agreement ahead of time before we get started.  Once again, appreciate your time and your advice.  Stay well.  

Thanks for the reply @Aaron Osgood.

She isn't picking finishes although I have been running some items by her for her opinion since she's involved in that market.  She is keeping track of subcontractors and payments (I've given her blank checks) and there isn't a true general contractor in a sense.  We are acting as our own GC, with her being my eyes and ears on the ground.  She has found most if not all of the subs that we are using and she has had some help from the guys at the company that she works with as they are active investors as well and do a lot of rehab work so we are getting good numbers from the subs.  We are both taking phone calls although she does probably get more then me since she is/was the subs main point of contact.  I would basically review the quotes, follow up with the subs via phone calls to make sure the scope is the same for all subs and what I was looking for.  She handles more scheduling items then I do and she is also taking in some deliveries for me with regards to fixtures and things.  The rehab is coming in at about 20k in total which includes appliances.  Mostly cosmetic items in my opinion (new flooring, painting cabinetry, fresh paint, electrical and plumbing fixtures) etc and one bathroom is having a completely new tub, shower body (+ finishes) cement board walls, waterproofing and tile work.  I should mention that its a 2 bedroom / 2 bathroom condo, approx. 1,200 SF.

I was thinking around 15% +/- as well, I just didn't want her to be insulted since we never really discussed the matter.  My other rehabs that I've done have been here in NY, where I handle pretty much everything so I wasn't quite sure what it was worth and what others have experienced/paid out in the past.

Thanks again for your input!

Hey fellow members, I have a question that I wanted to bounce off you guys since I see that many members successfully manage out of state rehabs.  I'm currently in the midst of a rehab in Florida while living in NY.  My cousin who happens to be a real estate salesperson in the tampa area has been handling things for me in a sense of contractor meetings, scheduling subs, getting quotes etc... While we never discussed a rate or fee there was always an intention that she would be paid for her time.  How do you typically handle this?  Hourly or Percentage based? and What is the norm or shall I say typical for this sort of thing compensation wise?

Many thanks in advance!

Typically when banks know the property is an investment property and not owner occupied rates tend to be slightly higher as well. are you planning on occupying the home or are you planning to rent out to others?

Thank you all for your responses.  I guess I should have clarified my initial thoughts in my posting although I appreciate the insight/advice from all.  

My initial reaction was to end the lease at the date they had requested which would give them approximately one month to clear things out at while making repairs that may be necessary and/or marketing the apartment.  My only request was the covering of the brokers fee which is equal to one months rent unless they were able to find me a qualified tenant in which case no fee would need to be paid and if no repairs needed to be done then they obviously would get the security deposit back as well.  If they were able to get moved out earlier than they expected, I would also refund them the additional days of rent that was already paid. 

I wasn't thinking of asking them to cover loss income until someone that I spoke to mentioned it to me.  After speaking to a few landlords, attorneys and friend's that I know in which some had similar thoughts to those above but more than one mentioned the loss of income.  While the rational was to take the emotions out of the equation and I can respect that, my gut was telling me exactly what everyone above basically posted.  

I lost a very good client of mine the same day that I lost my tenant and while landlording is a business its not my livelihood.  A few extra dollars isn't going to change anything on my end.  I just wanted to see what the opinions/experience was of fellow BPer's were since I previously heard two different sides of the spectrum.  I am fairly new to this industry and have never had an experience like this in the past nor has anyone that I have known.    

@Deanna McCormick - How does one deal with the refund of the security deposit if the tenant is deceased and the daughter who co-signed is not on the lease?  One daughter had asked me to give it back to the co-signer (different daughter).  Is this what is typically done?

Thank you again everyone for the advice.

Good Morning Fellow BPer's!

I have a situation that has come up recently with a rental unit that I have and wanted to see what the communities thoughts are. My tenant recently passed away 11 months into a 2 yr lease in which his daughter guaranteed the lease payments. The daughters have since asked to be released from the lease early which I do not have an issue with although I do not feel that I should be subject to a loss in my income stream due to this unfortunate event. How do you craft such a response without sounding harsh? Has anyone else ever had this issue? The daughter's have agreed to pay my expenses but I think they are under the impression that its soley the broker's fee and any fees payable to the HOA.

Thank you in advance for your replies!

Mike  

@Bill S. thank you for the additional reference.  I will forward this along to my friend as well.